Is Google the new Microsoft?

Google is the public’s good friend. The company gives us Internet search, access to maps, software for writing and calculating, et cetera. And all for free! As a company, it has always maintained to have the public interest at heart. In the words of Google’s founders Larry Page and Sergey Brin: "We believe a well-functioning society should have abundant, free, and unbiased access to high-quality information." In their vision, this required "a company that is trustworthy and interested in the public good."

Furthermore, their investor relations’ page states words that speak volumes: “Don't be evil. We believe strongly that in the long term, we will be better served by a company that does good things for the world (…). This is an important aspect of our culture and is broadly shared within the company.”

Even though Google clearly sees itself as one of the Good Guys, the United States Government is getting leery. One company is getting an awful lot of power in a very important market. Since 2007, Google has attracted the attention of the Justice Department’s antitrust division. Recently, president Obama appointed Christine Varney, who has showcased a very critical attitude towards Google, as head of the antitrust department. Mrs. Varney is a driven and experienced antitrust lawyer. Defending Netscape in the late nineties, Mrs Varney played a key role in portraying Microsoft as the big bully of the Internet playground.

This attention from the antitrust division is not unwarranted. In all places where market power and control increasingly condense in one or very few players, other types of power soon follow.

A case in point is route navigation. Google maps has, until now, relied on the thorough knowledge of specialised map makers TeleAtlas and Navteq. However, with Google’s new streetview service, Google teams have created detailed street-level maps of nearly the entire United States. Thus, they no longer need to rely on third party maps. Google uses this knowledge by offering a free navigation application, effectively driving firms like TomTom and Garmin, who build navigation technology and own the map makers, out of business.

It’s not as if Google does so because its an evil, monopolist company that in its behaviour contradicts the interests of anyone but itself. Quite the contrary. For users, free navigation certainly is a boon. However, even a friendly giant will crush that what’s underfoot.

Google’s book deal paints a similar picture. To serve the public interest, it commenced to scan and publish books online, for free. However, it had not secured the approval of authors beforehand. When the Authors Guild started a lawsuit, a settlement was reached. Being the giant that it is and already having a huge repository of scanned works, Google was able to settle advantageously. Striking a deal with the big publishing houses, Google consolidates its own position, potentially at the expense of individual right holders and authors.  

As Google stretches its business arms to encompass more markets and enters these markets with free products, there is a risk that quality and diversity of offerings in these markets will decrease as most players will not be able to compete with Google’s favourite price. For the sake of innovation, diversity and choice, it is important that online markets are not dominated by a few giants, not even friendly ones like Google.